I dont like comparing Presidents' handling of economies b/c there are so many variables that need to be taken into account, including variables that presidents really have no control over. But here it goes:
A common mistake in comparing the economies of the two presidencies is starting at the first year of each of thier terms. Clinton and Bush took over during different points in the corresponding business cycles. Clinton took over when the economy was already 2 years in expansion, Bush took over two months BEFORE the recession officially began. Therefore, to be fair, you have to start measuring Bush's performance at 2003 if you are going to start measuring Clinton's performance at 1993. After doing that, you will find that in most areas Bush actually has better statistics.
So Bush already has the disadvantage of inheriting a recession, while Clinton inherited an expansion. Bush is fighting two wars, had to deal with the 9/11 terrorist attacks, he had to deal with higher oil prices, he had to deal with the fallout of two major corporate scandals. Which reminds me: Sarbanes-Oxley probably hasnt helped a whole lot either. (Unfortunately Bush had to sign that into law or it would probably have been political suicide for him.) And he had to deal with Katrina. He also had to deal with a Republican Congress that had become drunk on power and lost its fiscal virtues. When you consider all of these obstacles, I think it is safe to say that Bush wins. Although Clinton wasnt too shabby either. Actually, the economy is Bush's crowning achievement. In the 90s, things didnt start to get really good until 1997. Thats when the expansion entered its latter strage, which is when wages always start to go up. Another main cause of this prosperity was a major tax cut on capital gains that Clinton signed into law.
Clinton did not put the US in a recession. The business cycle pretty much governs the expansion and contraction of our economy. The man most responsible for that is the Chairman of the Federal Reserve.
I agree. There really isnt anything Clinton could have done to prevent the bursting of the tech bubble. If anything it was the fault of the Federal Reserve. During the summer of 2000, I beleive they continued raising interest rates even while many prices in the economy were declining. In the future, the Federal Reserve needs to find a way to prevent asset bubbles from developing.
Bush did not get us out of the recession. The real players were the ongoing benefits paid from the computer revolution, an overextended housing boom, and artificially suppressed interest rates by the Fed.
Actually I beleive Bush's tax cuts played as big of a role, particularly his tax cuts on capital gains and dividends. His tax cuts on income were probably not huge enough to have a big effect. He decreased the top income bracket to 35% only from 39%. That's still higher than when his dad was president. It should have been decreased to 27%, which is where it was when Reagan was president.
